In 2007 AEP entered into a court-approved settlement of New Source Review (NSR) litigation (view news release). Although much of what we have implemented was already completed or under way to comply with the Clean Air Act, these initiatives were included in the consent decree. We continue to take steps to achieve compliance in accordance with the NSR consent decree. Since it took effect in December 2007 we have completed the following major actions:

• Annual NOx emissions from coal units in the AEP-East system were reduced below 96,000 tons in 2009 and were reduced to 77,424 tons in 2011.
• NOx reduction systems were installed at six units. Selective Catalytic Reduction installations were completed at Mitchell Units 1 and 2 and Conesville Unit 4, and Selective Noncatalytic Reduction were installed at all three Clinch River units
• The 2011 SO₂ emissions cap for the coal units in the AEP-East system was 450,000 tons. In 2011, SO₂ emissions were 358,908 tons.
• Flue gas desulfurization (FGD) installations for SO₂ reduction were completed at all three Amos units and Conesville Unit 4, and FGD upgrades were completed at Conesville Units 5 and 6. FGD controls at Cardinal Unit 3 to be completed early 2012.
• Sporn Unit 5 was included in initial Consent Decree as requiring retrofit, retirement or repowering. This unit was officially retired in February 2012.
• Annual SO₂ emissions were maintained below the plant-wide caps at the Clinch River and Kammer Plants in 2011. Actual SO₂ emissions for Clinch River Plant in 2011 were 5,921 tons compared with a cap of 21,700 tons. Actual SO₂ emissions for the Kammer Plant in 2011 were 16,712 compared with a cap of 35,000 tons.

• We awarded $2.9 million for mitigation projects in 2011. Previous mitigation awards included $2 million to the National Park Service, $3 million to organizations dedicated to mitigation of nitrogen impacts in the Chesapeake Bay, and approximately $7.5 million to state and other partners undertaking land acquisition and restoration projects in Indiana, Kentucky, Ohio, Virginia and West Virginia required by the consent decree.
• We funded a total of more than $12.5 million in mitigation projects undertaken by the States of Connecticut, Maryland, Delaware, Rhode Island, New York, New Jersey, New Hampshire, and Vermont.
• AEP placed into service seven plug-in hybrid electric passenger vehicles and 14 bucket trucks in 2011. Buckeye Power placed three hybrid passenger vehicles and one hybrid truck in service in 2011.

The economic recession continued to depress sales of electricity throughout the AEP-East system, which substantially reduced emissions during calendar year 2011 below the levels projected based on normal operations, prior to the beginning of the Consent Decree.

 
NSR Mitigation Projects
On Dec. 10, 2007, the U.S. District Court for the Southern District of Ohio entered a consent decree between AEP, the U. S. Department of Justice on behalf of the U.S. Environmental Protection Agency, eight states and 13 environmental organizations, regarding alleged violations of the New Source Review provisions of the Clean Air Act. Pursuant to the consent decree, AEP agreed to provide $10 million for the acquisition and/or restoration of ecologically significant areas in Indiana, Kentucky, Ohio, North Carolina, Pennsylvania, Virginia and West Virginia. In addition, AEP will provide $3 million to fund nitrogen impact mitigation projects in the Chesapeake Bay watershed. 

The following summarizes the projects that have been completed or are in progress:

• Canaan Valley, West Virginia: AEP, along with The Conservation Fund and the U.S. Fish and Wildlife Service (USFWS), provided partial funding for the addition of 120 acres of important wildlife habitat to the Canaan Valley National Wildlife Refuge, which features nationally significant wetlands and the headwaters of the Blackwater River, a tributary of the Cheat River. Because of its high elevation and diverse habitats, the refuge is home to more than 280 species of wildlife, including American woodcock, the threatened Cheat Mountain salamander, Indiana brown bat and endangered West Virginia northern flying squirrel. The valley’s unique boreal ecosystem is also home to 580 species of plants, including plant species found only in northern latitudes. ($1,775,000)
• Great Lakes / Fish Creek, Indiana:  A 658-acre tract was purchased by The Nature Conservancy with AEP funds. Fish Creek has the highest generally recognized biodiversity rank and may be the most diverse stream system in the southern Great Lakes basin. Within the watershed, several listed species occur, including Blanding's turtle, Copperbelly water snake, and the Blue-spotted salamander, as well as several rare mussels in the creek itself. Fish Creek contains three federally endangered mussel species. Well over 100 species of migratory birds fly through this area, including the Wood thrush which has been hard hit in the northeast due to acid deposition. ($2,500,000)
• Wabashiki, Indiana: Funds were given to the Indiana Department of Natural Resources to purchase 277 acres in Vigo County, linking two other conservation areas. The Wabash River corridor is a major migration route that provides resting and feeding sites for neotropical migrants, wading birds and waterfowl. Nesting habitat will also be provided as these properties are restored and managed as wildlife habitat. ($500,000)
• Dragon Run, Virginia:  The project includes land acquisition and forest restoration of approximately 1,700 acres of land. In a study on significant natural areas in the Chesapeake Bay watershed, the Smithsonian ranked Dragon Run as the second-most ecologically significant conservation area. Restoration of the site to a late successional, mature or “old growth” condition will provide far greater benefits for a wide range of species. The project will restore and protect ecologically significant lands in an important conservation area from conversion and fragmentation. ($1,500,000)
• Little Coal River, West Virginia:  In-stream structures will be built in the river to assist in sediment transport, bank stabilization and habitat restoration in a 25-mile reach of the Little Coal River. Riparian restoration will also occur. The native mussel assemblage of the watershed was adversely impacted by sediment runoff from agricultural development in the 19th and 20th centuries. Impacts from surface mining, logging, and oil and gas exploration have continued this harmful sedimentation process and prevented the native mollusks from repopulating. The river is a prime warm water fishery in the areas of the river where gradient assists in the transport of sediment providing critical habitat for macro invertebrate and fish species. The river also has numerous cold water tributaries that contain trout. ($1,450,000 with $500,000 paid to date.)
• The Vinton Furnace State Forest, Ohio:  AEP provided funds to The Conservation Fund and the Ohio Department of Natural Resources, along with other organizations, for the acquisition of more than 15,000 acres for the creation of the Vinton Furnace Experimental State Forest. The newly created state forest is one of the most biologically diverse ecosystems in the United States and home to more than 50 years of ongoing forest research. The forest is home to the state's largest known population of bobcats and is also home to black bears, timber rattlesnakes, cerulean warblers and several rare plant species. It is the site of some of the oldest and most important forest ecosystem studies in the country and is a world-class training and education center. (($1,850,000)
• Crooked Creek Barrens State Nature Preserve, Kentucky: The Kentucky State Nature Preserves Commission purchased a parcel of land with funds provided by AEP and AEP donated an additional parcel of land to extend the Crooked Creek Barrens State Nature Preserve. The Preserve features a unique oak barrens/limestone slope glade complex and adjacent oak-hickory forest. The limestone glades are exceptional in quality. Prairie species including Prairie Dock occur in the barren areas. Two rare bird species that are a state special concern have been known to breed at this site. There are no other barren/glade systems of this kind in northeastern Kentucky. These systems are unique from the other barren/glade systems in the central portion of the state which increases their overall value to the state’s biodiversity. ($292,000)
• Laurel Fork on Pine Mountain, Kentucky: The Kentucky State Nature Preserves Commission will purchase 1,592 acres on the Laurel Fork with funds provided by AEP, among others. Laurel Fork is a free flowing stream which is located along the base of Pine Mountain. It is one of few streams in southeastern Kentucky that has not had the riparian corridor developed with roads and houses. These lands contain significant natural areas that include federally listed mussel records and globally rare species including the Rock Harlequin, Cumberland Arrow Darter, and Blue Mountain mint. It is also part of one of largest forest blocks in the state. ($169,000)
• Davis Tract, Virginia:  With funding provided by AEP, the Virginia Department of Conservation and Recreation will permanently protect the 92-acre Davis tract at the southern tip of Virginia’s Eastern shore and restore agricultural fields on this tract to migratory songbird habitat. The tract also supports very threatened secondary dunes, natural wetlands, and beach habitat occupied by the state and federally threatened Northeastern Beach Tiger beetle and maritime forest that supports migratory songbirds and other coastal species. ($1,500,000)
• Edge of Appalachia Expansion, Ohio: AEP will work with the Ohio Chapter of The Nauture Conservancy (TNC) to acquire properties or enter into conservation easements near the Edge of Appalachia preserve system and west of the Shawnee State Forest in southern Ohio.  The Edge of Appalachia preserve system is a key component in the effort to restore North America’s oldest and most biologically diverse forest system.  The conservation action provides habitat for migratory songbirds, reptiles such as the endangered Timber rattlesnake and green salamander, and mammals, including the Allegheny woodrat and bobcat.  (New project approved February 10, 2012.)

As of April 13, 2012 the total amount transferred for environmental mitigation projects is $10,755,000.

Projects approved in 2011 included municipal waste collection vehicle retrofits, installation of a 100-kilowatt wind turbine, municipal energy efficiency programs and replacement of an outdoor wood-fired boiler program.